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Diligence Mode

Updated

Introduction

The system allows you to turn on Diligence Mode for third parties that you've invited to access your data room. This is recommended for investor-type relationships with third parties only. Diligence mode means that the system will track the entity's activity in your data room and can report it to your company. It also means the system can notify the third-party entity when your company adds or modifies files in your company's data room. With diligence mode enabled, when the third party downloads a document, a watermark (similar to the one depicted below), will automatically be applied.

Diligence mode does not change what documents are shared with the investor. It just changes the features available for whatever documents happen to already be shared.  If you think your investor should be able to see more documents, first add the third-party entity and allow them to see your data room.  If you're looking to add a third party to your account so that they can access your data room, please read the instructions included here. If you've already added a third party to your account, but you're looking to give them access to more documents, please read the instructions here. 

How to Enable Diligence Mode

Follow these steps to enable diligence mode for a third-party entity added to your account.

  1. From the Company Workspace, go to Directory > Companies and Firms.
  2. Click on the three-bar menu to the right of the entity and select Manage Team.
  3.  In the Data Room section, click Settings.
     
  4. Change the Enable Diligence Mode toggle to On. 
  5. Select if you want to watermark documents. Enabling this will add a watermark to documents downloaded from the Data Room. You can also specify if spreadsheets should be watermarked, which will convert the spreadsheet into a PDF to apply the watermark. When disabled, you will be able to download a spreadsheet in its original form. 
  6. Daily activity reports can be enabled. The Access Activity Report will send a daily digest email to the specified users at your company of the third-party's activity in the Data Room during the diligence period. The Data Room Change Report sends a daily report to the selected third-party team members of all changes in the Data Room. If left blank, no daily reports will be sent. 
  7. Select if you wish to notify the third-party if there are changes to the diligence mode settings. 

Third-party Notifications 

In addition to receiving notifications of diligence mode changes, the third-party entity can add users on their end to receive the daily activity report. This is only available if diligence mode has been enabled by the company. 

  1. From the third-party's workspace, go to Directory > Companies and Firms. 
  2. Click the three-bar menu for the company and select Manage Team. 
  3. In the Diligence Tracking section, click Settings. 
  4. Click Add and select the users from the dropdown menu. 
  5. Repeat for each user that should receive the report.
  6. To remove a user, click the X to the right of their name. 
  7. Click Save. 

Permissions

You can control which folders in the Data Room are available to third-party entities. When in the Companies and Firms > Team Management page, click on Data Room Permissions. From here you can select which folders and what level of access to grant. 

Checking on a folder will automatically grant access to any subfolders. In the example below, the Corporate Records folder is checked, and all subfolders inherit the same permissions as that folder. 

There are three levels of access you can grant for each folder: View, Modify, or Modify & Share. You can set different levels of permissions for each folder if necessary. 

Additionally, you can set an expiration date for a folder's permissions. 

You can remove access by unchecking any folders or permissions you no longer want to share with the third party. The third party will not receive any notification when the permissions are revoked.

From the Companies and Firms directory, there is an option to Suspend Granted Access which can be used to remove all granted access for the third-party entity. If you select this option, the third party will still be able to log into the system but will be unable to access anything they no longer have access to. If, for example, they are signatories to an NDA they signed with your company, they will retain access to those documents, but all other access will be revoked. 

Screenshots are for illustrative purposes only.

Fidelity provides cap table management and other administrative services to private companies and their equity compensation plans.

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